According to Recode, Coinbase assigned itself an $8 billion valuation in its offer to Earn, which included an equity package that distributed shares of the exchange operator’s common stock to Earn investors.
Coinbase has not discussed the terms of the Earn deal publicly, though Earn CEO Balaji Srinivasan said that, in addition to profits already distributed, the buyout had provided investors with a positive return on the more than $120 million they had invested in the company over the years.
In any case, the report indicates that Coinbase believes its value has exploded by several hundred percent in just a single calendar year.
Coinbase became the first “cryptocurrency unicorn” last summer when a funding round pegged its valuation at $1.6 billion. However, the company has experienced breakneck growth in the months since closing that investment round and reportedly brought in $1 billion in revenue during 2017.
This growth was largely — though not exclusively — due to a fourth-quarter cryptocurrency rally that was so pronounced that many exchanges paused new user registrations for months while they scrambled to scale up their internal operations.
According to the publication, brokers have approached existing Coinbase investors offering to buy their shares at prices that would value the company between $4.5 billion and $6 billion.
However, neither these offers nor Coinbase’s internal numbers are official, and Recode notes that the company may undergo a formal 409a valuation — which will be conducted by a third-party auditor — in the near future since it has recently acquired Earn and several other smaller startups.
Though best known for its cryptocurrency exchange and brokerage platforms, Coinbase has recently begun to branch out its product line. Earlier this year, the firm launched a cryptocurrency index fund for accredited investors, and more recently it announced its first venture capital fund.
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